Square Enix has 66% increase in profits in 2017 mainly on sales of older games

Japanese video game developer Square Enix has just reported a 66 percent increase in profits in 2017, over the same period in 2016.

Results announced were for the nine months up to December 31st, 2017.

What is interesting too about this quite large increase in profits is Square Enix also reports sales of new games fell in 2017. Primarily due to few blockbuster games being released by the developer.

Instead, where Square Enix saw a massive profit increase in 2017 was in digital downloads of older games. High-margin download games like Life Is Strange, NieR:Automata, Rise of the Tomb Raider, Hitman, A King’s Tale: Final Fantasy XV and The Walking Dead. 

That 66 percent increase in profits was also on a 1 percent fall in actual sales. Makes sense, though, when you think about is as, with older games, expenses have already primarily been recouped. So sales in years after the games’ initial release tend to be almost all profit.

The developer also had huge success with their mobile games, especially with games like Final Fantasy Brave Exvius and Kingdom Hearts Union.

Then again, these Square Enix profits are probably not news to most people that follow the video game industry. After all, Square Enix was reporting enormous profits every other quarter during the 2017 fiscal year as well.

With one quarter left in the this fiscal year, Square Enix has also updated its full-year forecast.

Due to this just-announced massive increase in profits, the developer now expects total sales for the 2017-2018 fiscal year to hit around 240 billion~260 billion yen ($2.2 billion~$2.37 billion).

On those sales, they estimate profits for the Japanese behemoth will be in the region of 16.5 billion~19.5 billion yen ($151 million~$178.4 million) at the end of the final quarter on March 31, 2018.

Quite astounding really. Especially when you take into consideration the lack of new blockbuster games.

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